Tightening Labour Markets Underpin Advanced Economy Consumption

The ongoing tightening of labour markets across the largest advanced economies is one of the clearest trends highlighted in Fitch Ratings' latest 20/20 Vision chart pack and is helping to underpin consumer spending.

Healthy job growth and declining unemployment in the US, eurozone and Japan is boosting household real incomes and helping to support consumer confidence. But at the same time tightening labour markets are providing impetus for monetary policy normalisation by the Fed and are giving the ECB more confidence to signal the phasing out of quantitative easing by year-end.